Now, as Congress ponders the end of the tax cuts that President Bush initiated early in his tenure, it is difficult to separate fact from fiction in the arguments for and against that are being presented, particularly in the area of "small business" vs. "corporations."
The Democrats propose to keep the tax cuts for individuals earning less that
$250,000 per year while letting those for people earning more to rise to help
cover the expenses of salvaging the national economy. In return, the Republicans
are demanding that all tax cuts remain in place for the sake of "small
business." They tell us that any increase on those with taxable income of a
quarter-million dollars a year will "devastate small business and sacrifice
Don't buy that malarkey! A little knowledge of business, bookkeeping, and ownership will help us wade through all the "bogie-speak" and let us understand what is being considered.
First, the proposed figures would apply to the individual income.
That lets out the corporations, whether large or small. It would apply only to
privately-owned businesses such as a home-service company that does things like
plumbing or appliance repair, some car-repair shops, construction companies, or
mom-and-pop neighborhood stores.
In determining the "taxable" income of the owner, first the gross is
computed. This is the total amount collected from the goods or services by the
business. In a business that is at all successful, that could be a staggering
number! But then, so is the total number of the expenses which must be
subtracted from it in order to determine the net profit or loss from
the business. If one person owns the business, this will be his or her taxable
income. If more than one person owns the business, that figure must be divided
between them. In most cases, it will be a whole lot less than a
This knowledge, while simplified, may give one a better understanding of the issue at hand. It does not completely apply in the case of a corporation, beyond the basics, but they are taxed under an entirely different system involving things like "shares," "reinvestment," and other esoteric terms that are not necessary in a discussion of "small business."
Why are the right-wing loud-mouths trying to scare us to death about the fair
and necessary tax increase on the investor-class to whom George W. Bush handed
the keys to the national treasury? Because they are the ones who do not
want to pay their fair share! I hope the debate makes more
sense once you truly understand the subject that is being discussed. As
currently planned, the same bill that will increase the tax burden on the
really-well-off will also carry an extension of the cuts for the low-income and
a reduction for the middle class.
That is you, so get out there and support it! When opponents strut around like pretentious hens, crying "Cut! Cut! Cut! Barack!" you will know that they are full of "Cockle-Doo-Doo, too!"
It is trite, but true, that the reason we must "tax the rich" is because the poor have no money.